Fresh bids for two sectors spell hope for oil companies

The Directorate of Petroleum in Jaipur is on a high and is suddenly thinking big again. After Cairn Energy announced that they had struck oi...

The Directorate of Petroleum in Jaipur is on a high and is suddenly thinking big again. After Cairn Energy announced that they had struck oil in the desert, the Directorate is hoping that they will get lucky again when fresh bids are called for two new sectors in April.

About 32,000 sq km in the Vindhyan Basin near Bundi and 2,700 sq kms in the Jaisalmer basin go under the hammer in April during the national bids. Director of State Petroleum Directorate S.K. Mittal says ‘‘Hopes are high’’.

This optimism follows Cairn Energy’s big strike in Barmer district, where the firm claims to have found an estimated 20 million metric tonnes of oil and gas reserve in the Barmer-Sanchore basin. The field is likely to produce about 155 million barrels of oil, increasing the in-place reserves in this region to 250 million barrels per day.

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‘‘This means big business for the state,’’ Mittal says. ‘‘We are expecting at least Rs 450 crore in royalty once the company starts production. It will take around 20 years but it is big money. Also, the employment generation in the area is going to increase manifold. This has been a good thing.’’

Cairn Energy tied up with ONGC in 1995 and has been digging around in Rajasthan since then. Their initial seven-year contract was extended for another three years after they struck oil in 2001. So far, the company has invested more than Rs 200 crore on exploration and is expected to put in another Rs 84 crores. At present, Cairn Energy has to dig at least three more wells in the Barmer-Sanchore basin.

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